Corporate Transparency Act: What Texas Business Owners Need to Know About BOI Reporting

If you own a business in Texas—whether it’s an LLC, corporation, or other registered entity—there’s a federal compliance requirement you need to know about. The Corporate Transparency Act (CTA) requires most businesses to file Beneficial Ownership Information (BOI) reports with the Financial Crimes Enforcement Network (FinCEN). Failure to comply can result in significant penalties, including daily fines and potential criminal charges.

At Griffin & Cain, Attorneys at Law, our Conroe business law attorneys are helping local businesses understand and comply with these new requirements. This guide explains what the Corporate Transparency Act requires, who must comply, and how to protect your business.

What Is the Corporate Transparency Act?

The Corporate Transparency Act, enacted as part of the Anti-Money Laundering Act of 2020, requires certain businesses to report information about their “beneficial owners”—the individuals who ultimately own or control the company. The goal is to prevent anonymous shell companies from being used for money laundering, tax evasion, and other financial crimes.

The CTA requires “reporting companies” to file BOI reports with FinCEN, a bureau of the U.S. Department of the Treasury. These reports identify the real people behind business entities.

Who Must File a BOI Report?

Reporting Companies

A “reporting company” is any entity that is:

• A corporation, LLC, or similar entity created by filing with a state secretary of state or similar office
• A foreign company registered to do business in the United States

This includes most small businesses in Texas, including:

• Limited liability companies (LLCs)
• Corporations (both S-corps and C-corps)
• Limited partnerships (LPs)
• Limited liability partnerships (LLPs)
• Other entities formed by state filing

Exempt Entities

Certain entities are exempt from BOI reporting requirements. The CTA includes 23 exemption categories, including:

• Large operating companies: Companies with more than 20 full-time employees, more than $5 million in gross receipts/sales, and a physical operating presence in the U.S.
• Publicly traded companies: Companies registered with the SEC
• Banks and credit unions: Already subject to extensive federal reporting
• Insurance companies: State-regulated insurance entities
• Investment companies and advisers: SEC-registered entities
• Public utilities: Regulated utility companies
• Tax-exempt organizations: 501(c) nonprofits and similar entities
• Inactive entities: Companies that have been dormant since before January 1, 2020, and meet other criteria

Most small and medium-sized businesses in Montgomery County, Walker County, and the Houston area do not qualify for these exemptions and must file.

What Information Must Be Reported?

Company Information

The BOI report must include information about the reporting company:

• Full legal name of the company
• Any trade names or “doing business as” (DBA) names
• Business address
• State of formation or registration
• Taxpayer Identification Number (TIN) or Employer Identification Number (EIN)

Beneficial Owner Information

For each beneficial owner, the report must include:

• Full legal name
• Date of birth
• Current residential address
• Identifying number from an acceptable identification document (driver’s license, passport, or state ID)
• Image of the identification document

Who Is a “Beneficial Owner”?

A beneficial owner is any individual who:

• Owns or controls 25% or more of the ownership interests in the company, OR
• Exercises substantial control over the company

“Substantial control” includes individuals who:

• Serve as senior officers (CEO, CFO, COO, etc.)
• Have authority over the appointment or removal of senior officers or a majority of the board
• Direct, determine, or have substantial influence over important decisions

Most small businesses have at least one beneficial owner. Many have multiple—for example, a husband and wife who each own 50% of an LLC would both be beneficial owners.

Company Applicant Information (for entities formed after January 1, 2024)

Companies formed on or after January 1, 2024, must also report information about “company applicants”—the individuals who filed the formation documents. This includes:

• The person who directly files the formation document
• The person primarily responsible for directing or controlling the filing

Filing Deadlines

The deadlines for BOI reports depend on when your company was formed:

Important: If any reported information changes (new beneficial owner, change of address, etc.), you must file an updated report within 30 days of the change.

How to File a BOI Report

BOI reports are filed electronically through FinCEN’s BOI E-Filing system at https://boiefiling.fincen.gov. The process involves:

1. Accessing the BOI E-Filing portal
2. Creating an account (or filing as a guest)
3. Entering company information
4. Entering beneficial owner information for each beneficial owner
5. Uploading images of identification documents
6. Reviewing and submitting the report

There is currently no filing fee for BOI reports.

FinCEN Identifier Option

Individuals who will be listed as beneficial owners on multiple reports can obtain a FinCEN Identifier—a unique number that can be used in place of personal information on BOI reports. This is useful for:

• Business owners with multiple entities
• Registered agents
• Attorneys who form entities for clients

Penalties for Non-Compliance

The penalties for failing to comply with BOI reporting requirements are severe:

• Civil penalties: Up to $500 per day the violation continues
• Criminal penalties: Up to $10,000 fine and up to 2 years imprisonment for willful violations
• Additional penalties: For providing false or fraudulent information

Senior officers of companies that fail to file may be personally liable for penalties.

Common Questions About BOI Reporting

Does my small LLC need to file?

Almost certainly yes. Unless you meet one of the 23 specific exemptions (most of which don’t apply to small businesses), you must file. Single-member LLCs, family businesses, and even dormant entities typically must file.

What if I have multiple businesses?

Each reporting company must file its own BOI report. If you own several LLCs, each one files separately. Consider obtaining a FinCEN Identifier to simplify the process.

Do I need to file every year?

No. BOI reports are filed once and then updated only when information changes. There is no annual filing requirement.

Who can see my BOI information?

BOI information is not publicly available. Access is limited to:

• Federal law enforcement agencies
• State and local law enforcement with court authorization
• Federal agencies for national security purposes
• Financial institutions (with customer consent) for due diligence

What if I’m not sure if I’m exempt?

If there’s any doubt, it’s safer to file. The penalties for failing to file are significant, while filing unnecessarily has no penalty.

How a Business Attorney Can Help

While BOI filing can be done without an attorney, there are situations where legal guidance is valuable:

• Complex ownership structures: Determining beneficial ownership in multi-tiered entities, trusts, or investment arrangements
• Exemption analysis: Confirming whether your company qualifies for an exemption
• Multiple entities: Coordinating filings across several related companies
• Privacy concerns: Understanding how to use FinCEN Identifiers and protect sensitive information
• Compliance programs: Establishing systems to track changes and ensure timely updates

Other Business Law Considerations

The Corporate Transparency Act is just one of many compliance requirements for Texas businesses. At Griffin & Cain, we also assist with:

• Entity formation: Choosing and establishing the right business structure
• Operating agreements and bylaws: Documenting ownership, management, and procedures
• Contract review and drafting: Protecting your interests in business agreements
• Business succession planning: Coordinating with estate planning for business continuity
• Real estate transactions: Commercial real estate purchases and leases

Take Action: Ensure Your Business Is Compliant

The BOI reporting deadline has arrived for most existing businesses. If you haven’t filed yet, don’t wait—penalties accrue daily for late filing. If you’re forming a new business, understand that BOI filing is now part of the startup process.

At Griffin & Cain, Attorneys at Law, our business law team helps companies throughout Montgomery County, Walker County, and the Houston metro area navigate compliance requirements. We serve business owners in Conroe, The Woodlands, Huntsville, and surrounding communities.

Contact us today for a consultation about your BOI filing obligations and other business law needs.

Griffin & Cain, Attorneys at Law, PC

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